Grain markets fell last week as the effect of a worsening coronavirus pandemic hit financial markets around the world.  The FTSE fell 8% last week; falling from a high of 7,700 on 17th Jan to 6,580 on Friday.  Global commodities markets also fell; crude oil now down at $45/barrel and the grains complex weaker across the board. Comments from G7 countries, including the Bank of Japan and the US Fed states that they will use all fiscal tools available, including possible quantitative easing, to stabilise financial markets following the outbreak. Fed are rumoured to be cutting interest rates by half of 1%, on or before the next Fed meeting on March 18th.

Closer to home, farmers are starting to engage with grain markets again after a long period absent.  Growers now have genuine concerns over the global economy, and don’t want to miss out on current values for Harvest 2019 crop (despite being worried about a lower wheat area drilled for Harvest 2020).  The lack of winter wheat planting has already increased values £25/MT from Oct 19 to present values.  A further increase is unlikely with the weight of exportable surplus (1.0-1.5 MMT) still available from Harvest 19.

For more insight, speak to one of our traders: 01243 755650